Jason Levinthal, Brand Director and Founder of Line Skies, poses last week in his home office in Shelburne. / IAN THOMAS JANSEN-LONNQUIST, for the Free Press

Written by

Dan D’Ambrosio, Free Press Staff Writer

In a 1998 story about skier Picabo Street and her chances in the Nagano Olympics, the Free Press reported that Rossignol — Street’s ski of choice since she was teenager — was one of “seven major ski and snowboard manufacturers with U.S. headquarters in the Burlington area,” employing some 350 people.

Today, with the notable exception of Burton Snowboards, all of those companies are gone, moved West.

The migration of not only snow sport companies such as Rossignol, Dynastar, Karhu, Trak and Tubbs, but also other outdoor businesses such as Merrell, Isis, Mad River Canoe and the latest —Garmont — from Vermont to Portland, Ore., Seattle, Salt Lake City, Boulder, Colo., and other destinations in the mountainous West, has been going on for more than a decade, and worries people such as Bill Carter of Fuse in Winooski.

Carter is a partner at Fuse, a “youth marketing agency” with a list of Fortune 500 clients including Mountain Dew and Gatorade, and the recent distinction of being named to Outside magazine’s 2011 list of the 50 Best Places to Work in the country. Carter has been watching the exodus of ski and other outdoor companies from Vermont with dismay.

“I think when something happens as many times as it has happened here and for the period of time it has happened you got to look at yourself in the mirror and ask what is actually happening,” Carter said. “Unless you think it’s OK, which I don’t think it’s OK.”

Vermont finds itself in the unique position of being a safe incubator for innovative outdoors-oriented companies, which later find reasons to move up by moving on. Can the state succeed in nurturing success and keeping those successes here?

Carter is intimately familiar with the outdoor sports industry since many of his clients like to identify themselves with the active, outdoor lifestyle. He says when he travels the country visiting those businesses for his clients, and people find out he’s from Burlington, they don’t think, “outdoor sports.” More like Ben & Jerry’s ice cream or Phish.

“We do not do a very good job of making our home a credible and authentic place for outdoor and snow sports brands to not just launch and incubate, but to stay forever,” Carter said. “The Vermont brand, and I mean this very positively, is hippy and artsy and liberal. It’s a lot of fun, but it’s different than what we need the Burlington brand to be to support the outdoor sports community, which is unbelievable access to all things outdoors — mountain biking, road biking, fly fishing, backpacking, skiing, snowboarding.”

Carter is not proposing that all of the other things Vermont represents — maple syrup, fall colors, bed and breakfasts — should be overridden by outdoor sports. He is saying that those other things are drowning out the outdoor industry in the perceptions of its movers and shakers.

“The reason I think that matters is that when you’re growing an outdoor brand, part of your authenticity and credibility as a company by your own consumers is judged by who you are as a company, and where you are as a company,” Carter said. “If you don’t think Burlington is a credible location, and your consumers don’t think Burlington is a credible hub, you have to find a credible hub to remain an authentic brand in that space.”

Again the notable exception is Burton, which was not available to comment for this story. Burton, Carter says, can do whatever it darn well pleases, including staying in Burlington, because they own some 40 percent of the snowboarding market, a sport Jake Burton basically invented.

“They are far and away the leader in that sport,” Carter said. “They’ve got the biggest voice and the most credibility of anybody, and by the way, Burlington ought to be thanking their lucky stars when Burton says, ‘I want to be in Burlington because snowboarding in the Burlington area is authentic and credible. This is where real snowboarding happens.’”

On the other hand, there’s Garmont, an Italian manufacturer of ski boots and outdoor footwear for mountaineering, backpacking, hiking and trail sports that announced in July it was moving from Williston to the “outdoor and footwear capital” of Portland, Ore.

“Garmont’s decision to relocate was an extensive, deliberate process, and included evaluation of several possible regions with similar character to the brand’s northern Italian base,” the company said in a press release. “Portland’s progressive business climate, proximity to footwear industry giants and innovators, and year-round access to world-class hiking, climbing and skiing destinations made it an ideal match.”

Reading between the lines, Carter sees a situation where Garmont — not a dominant player in its industry like Burton, but a “second tier player trying to become something more than they are” — can’t stay in Williston because they won’t be taken seriously if they do.

“I’m not slamming them, they’re trying to latch on to something credible, which they think is Portland instead of calling out Burlington,” Carter said. “When Burton says it’s Burlington, people hear it and it comes across as true. Garmont can’t say that.”

Warding off poachers

The sense of urgency Carter feels about what he sees as the inexorable draining of Vermont’s pool of snow sports and outdoor companies is not shared by city or state officials.

Secretary of Commerce Lawrence Miller said the whole question of other states “poaching” particular industries from Vermont is “something we’re aware of,” but that the state has a recruitment philosophy centered on finding people who already have Vermont connections, and are more likely to succeed in starting a business here.

“In our experience, it’s a lot more effective than going to trade shows and talking to random companies about whether they’d like to move,” Miller said. “Whether it’s somebody who went to school here, somebody who grew up here and moved away but has a second home here, or vacations here, those things give us reason to believe somebody who moves here will be successful. This is not necessarily the easiest place for people to live if they’re not used to winter.”

Miller said his agency is finding those people through networking, talking to the presidents of the ski resorts to find out who their high-profile guests are, and to the universities to find out whether there are alumni who might want to start a business here.

“That has always been an instrumentality of economic development in the state,” Miller said. “It’s why IBM is here.”

Thomas Watson Jr., son of IBM founder Thomas Watson, famously skied at Stowe and bought Smuggler’s Notch before deciding to open IBM Burlington.

“That’s sort of the underpinning of what guides us,” Miller said. “We’re making it much more explicit. We are asking the universities and colleges to help us with this. We are retasking some of the people who work in the agency with how they go about their daily work. And we’re identifying industry segments that are growing in Vermont faster than they are other places, then reinforcing our efforts in those areas that are already growing.”

Miller said the outdoor sports industry has traditionally been a strong economic cluster for Vermont, and “we don’t want to lose it.”

“My sense of the specific cases of companies going, there were things I’m not sure Vermont’s branding would have changed, but I do think it’s a cluster we need to cultivate and support,” Miller said. “We have a lot of good attributes for the industry, specifically one of the populations in the country that does more outdoors than anywhere else.”

“Burlington has managed to attract not just businesses that cater to outdoor enthusiasts but a whole range of events, starting with the marathon and triathlon, and women’s world hockey,” Reinert said. “I think there’s room for a lot of different ways people can see Burlington, including as an arts destination, as well as for recreational enthusiasts. That doesn’t mean there isn’t room for improvement, but I think people do see Burlington and Vermont as a whole as a place to enjoy the outdoors, based on facts we see and based on the kinds of events attracted here.”

A 'cultural movement'

Unlike Garmont, most of the long list of outdoor and snow sport companies that have left Vermont have been purchased by conglomerates and brought into their Western folds:

• K2 Corp. snapped up Karhu, Line and Trak skis in 2006, moving them to Seattle.

• California surfing giant Quicksilver bought Rossingol and Dynastar in 2005, moving them to Utah. (A Rossignol employee later bought the company back from Quicksilver, returning it to French ownership, but U.S. operations remain in Utah.)

• American Rec bought the women’s clothing company ISIS and moved it to Boulder, Colo.

“We’re in a time of consolidation that has consumed a number of the smaller and mid-sized companies that were originated in Vermont,” said Jim Frazier of JDK, an advertising agency with offices in Burlington, New York City and Portland, Ore. “As a result, they’ve moved closer to their consumptive party.”

Frazier said there has also been a “cultural movement” to the West’s mountain centers by young people, and outdoor companies have followed behind to be part of that movement. Frazier also says Vermont is not an easy place to do business.

“Utah is doing a really good job of making doing business attractive, so they are pulling a number of snow and outdoor companies there,” Frazier said.

And unlike Portland, Utah is doling out tax incentives. Jeff Edwards, president of the Economic Development Corp. of Utah, said the state has a well-established tax credit program that allows for the state to give back a portion of taxes a company pays after it sets up operations and hires people. Each deal is struck individually with a company, depending on how many jobs they bring.

“It may be five years with a 10 to 20 percent rebate, after that the incentive goes away,” Edwards said. “We’re not giving away bags of cash. The state gives incentives after they create jobs.”

Edwards said Utah has thousands of people working in the outdoor industry. The Economic Development Corp. is a public-private partnership created 25 years ago and has a budget of $2 million per year, with a staff of 15 people working to bring many industries to the state, including aerospace and IT services.

Vermont-made snowshoes

Of course, Burton is not the only outdoor/snow sports company to remain in Vermont. The state still has a vibrant community of innovative smaller and medium-sized companies such as Rome snowboards in Waterbury, TSL snowshoes in Williston and Darn Tough Vermont in Northfield.

TSL is a French company, with a large following in Europe for its composite snowshoes, which are barely known here, where snowshoes are made of aluminum, thanks to Tubbs, formerly of Vermont. Tubbs, one of the companies purchased by K2 Corp. and moved to Seattle, helped to launch the recreational snowshoe business in this country.

Ted McGuinness, president of TSL America, is a Vermont native and has been involved in the outdoor industry for his entire career. He was with Line and Karhu skis when K2 bought them.

“Here’s the K2 Corporation in a couple hundred-thousand-square-foot building in Seattle, all their production is in China. It wouldn’t make sense to keep these two little ski companies in Burlington,” McGuinness said.

The rise of China as factory to the world is another driving force behind the westward migration. It’s a shorter flight from Portland or Seattle, or Salt Lake City, to China or Taiwan than it is from Burlington.

TSL makes its snowshoes in its warehouse space in Williston, attaching recycled plastic decking to the aluminum frames crafted in Quebec. A line of riveting machines out back stands near the cavernous space where shoes are inventoried and packed for shipping. In the offices up front, there’s a lineup of colorful composite shoes made in France, together with TSL’s aluminum models, in the conference room.

McGuinness says TSL remains in Vermont because majority owner Philippe Gallay wanted to repeat in the United States what he does in France: Buy and sell locally, and produce close to your market. TSL moved into the void Tubbs left behind, using the same local suppliers for crampons and other snowshoe parts Tubbs had used.

“Would it be cheaper to have some third-party Chinese company produce our snowshoes? Probably,” McGuinness said, “but then we wouldn’t be leaving our mark on Vermont.”

McGuinness said he’s been heavily recruited by representatives from Portland at the outdoor industry trade show held every year in Salt Lake City, but that he has never seriously considered moving.

“As long as we’re in business, we’re here to stay,” he said.

Personal ties to region

Josh Reid, co-founder of Rome snowboards, feels a similar devotion to Vermont, having come here from Massachusetts as a student at the University of Vermont and never leaving, although he understands the draw of the West for snow enthusiasts.

“It’s sunny, the mountains are larger, the snow is better, they’re more interesting mountains, and attracting people to the cold, gray Northeast is not the easiest thing to do,” Reid said.

About 60 percent of Rome’s boards are made in Austria and about 40 percent are made in Taiwan, Reid said. He said many of his two dozen or so employees start their workday at nearby Stowe Resort in the winter, and can still be at their desks by 9:30. The proximity to Stowe was a big reason Reid and his partner picked Waterbury instead of Burlington to start their company 10 years ago.

Rome is the third-largest snowboard company in the country, and a “hugely influential and important brand,” according to Drew Simmons of Pale Morning Media, a public relations firm in Waitsfield specializing in outdoor companies. (Rome is not a client.) Reid said he has been courted by the West, and despite being offered tax incentives by Utah, never seriously considered leaving Vermont.

“We have all these personal ties to the East, family, old friends,” Reid said. “It was really a personal decision more than it was a business decision, and I don’t think that’s healthy for the state, to have the state at the mercy of people’s personal decision on where to locate as opposed to making businesses want to locate here for rational reasons.”

Jason Levinthal also stayed in Vermont for personal reasons, even after Line Skis, the company he founded in 1995 in his parent’s garage in Albany, N.Y., was bought by K2 and moved to Seattle. Levinthal originally came to Burlington in 1999 when Line was first bought by Karhu — then based here — before K2 bought Karhu in 2006.

As the founder of a company that revolutionized the ski industry by putting tips on both ends of his skis, Levinthal was in a unique position to stay where he wanted to live, even though his company was moving.

“I’m here in Burlington, dude, I just love Burlington,” Levinthal said. “We’re innovators in the ski market. No one needs another brand in general unless you’re going to bring innovation to the market. We were the pioneers of the twin-tip ski movement. Skiers could go backward and do tricks. It was youth-driven, a modern time revolution in ski design. We were leading the way. We’re still innovating, enabling people to do more on their skis. Have more fun basically.”

Levinthal said he had stretched his resources to the limit in 1999, when Karhu came along and enabled Line to grow more. The same thing happened in 2006 with K2.

“The fact is you can only take a brand so far with your own resources,” Levinthal said. “I hit my own glass ceiling once in 1999 in Albany and had to find a company that would enable me to grow more. When K2 bought us, that opened the door once again for the brand to grow in distribution, volume and every other way, and get the price lower to sell and distribute more.”

Given his personal experience, Levinthal thinks he has a handle on where Vermont fits in when it comes to the outdoor business, or perhaps any business.

“I got really no beef with Vermont,” he said. “It’s actually one of the best places for startups. I don’t know if it has anything to do with the state as much as the spirit of the people who live here. Consumers will get behind your products. If I make a T-shirt or a jar of honey, people will buy it because it’s made here. But unfortunately when I get to the point to go to the next level, there’s no one bigger to support me. Maybe this is the startup state. That’s not all bad.”